The Google ad tech trial started on Monday, with opening arguments and first witnesses. At the onset, it is clear that the government will struggle to prove Google’s alleged monopoly or that the company has engaged in anticompetitive behavior to obtain or maintain its market position.

A backward-looking case

In her opening statement, Google’s lead lawyer Karen Dunn argued that the DOJ’s case is outdated and backward-looking. She compared the government’s focus to a “time capsule with a Blackberry, an iPod, and a Blockbuster video card.” According to Dunn, the case focuses on display ads on websites, but “user attention migrated years ago—to apps, social media, and Connected TV,” as Google noted in a recent court filing.

Flawed market definitions

Google contends that ad servers, exchanges, and networks are not separate markets. Instead, Google competes in a unified market with buyers on one side and sellers on the other. In its opening statement, Google pointed out that the DOJ’s definition would create separate markets for the same ad based on whether it appeared on The Washington Post’s website versus its app. “There’s no such thing as an ‘open web display advertising’ market,” Dunn said. 

— As Daniel Luque writes in the DisCo Project, the DOJ’s market definitions for “open web display advertising”—specifically publisher ad servers, ad exchanges, and advertiser ad networks—are unrealistic. They ignore the substitutability between different advertising channels and overlook the shared infrastructure of ad tech. The same tools are used across websites and mobile apps, and companies often use various channels like social media and video ads. By “excluding alternative channels as reasonable substitutes,” the DOJ’s definitions provide an incomplete view of the ad tech markets.

This overlap between different markets was further exposed during the cross-examination of the DOJ witnesses. During the cross-examination of Josh Lowcock, former global chief media officer at IPG-owned UM Lowcock and a DOJ witness at the trial, Google presented evidence that his former agency advised the US Postal Service to switch ad budgets between display and social platforms, implying those markets are interchangeable.

Google competes in a crowded market

In her opening statement, Dunn said, “We are going to show the court we are one big company among many others.” She presented a chart of numerous companies that sell advertising, such as Microsoft, Disney, and TikTok. According to Dunn, customers have plenty of options for placing ads online and choose Google’s services based on their merits. She acknowledged Google’s size but emphasized that it faces stiff competition in the ad-tech industry.

— Dunn’s point about competition was backed by Google’s financials. According to Google’s annual reports, revenue has actually declined from $31.7 billion in 2021 to $31.3 billion in 2023 for Google Networks, the division of the company which includes the services—AdSense and Google Ad Manager—at the heart of the case.

Witness cross-examinations further reinforced this point: 

— Tim Wolfe, an executive from Gannett Co. and the DOJ’s first witness, acknowledged Gannett was still able to work with competitors to sell its ad inventory. 

— Google introduced evidence during the questioning of Andrew Casale, CEO of rival ad platform Index Exchange, showing that Index Exchange had identified other technology companies as competitors in discussions with UK regulators.

Warning against misguided action

Dunn warned that past Supreme Court rulings caution judges about the “serious risk of error or unintended consequences” when regulating rapidly evolving technology. She argued that antitrust intervention against Google would not help small businesses but instead open the door for other tech companies to dominate the space.

— As we have pointed out before, small businesses are lining up against the DOJ in this trial, testifying on behalf of Google. On the other hand, the DOJ witnesses are primarily Google’s ad tech competitors.